Newark, New Jersey is about to get a giant vertical farm that produces millions of pounds of greens for local customers.

A vacant steel factory in Newark is turning into the world’s largest-producing vertical farm. After it begins running later this year, the farm’s indoor system of modular, stacked trays will grow around 2 million pounds of baby greens annually.

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The $30 million building will be the headquarters of AeroFarms, a company that has been developing vertical farm tech for the last decade. But the company sees the project as just the beginning–and hopes to build 25 farms in the next five years. AeroFarms already has eight smaller farms and five in the pipeline.

“This isn’t about one farm, this is about changing the way we grow food as a society,” says CEO David Rosenberg. “So this is a showcase, where it’s not just about demonstrating the technology but how we grow and how we get to economies of scale to make the economics work.”

Rosenberg is convinced that vertical farming will become an important part of agriculture. “It’s not going to supplant traditional farming,” he says. “But it’s going to be part of the picture. By 2050, we need to double our food-growing capabilities. Part of that solution is vertical farming.”

While the technology doesn’t make sense for row crops like corn and wheat, it works well for something like leafy greens, which sell for more in the grocery store–making it feasible to grow them in or near a city. They also often tend to wilt when they travel thousands of miles from a farm in California to a far away place like New York.

“There’s a very short shelf life in the space, and we realized that with technology and a smarter approach to farming we could have a meaningful solution,” says Rosenberg. The stacked growing system can product 70 times more spinach than a farm in the field, and deliver the crop directly to stores in a nearby city. In Newark, the farm will supply produce to a local food desert as well as New York City.

The aeroponic growing system the company uses also has some environmental advantages, like requiring 95% less water than growing crops in a field. At a time when most leafy greens in the U.S. are grown in drought-stricken California, it’s easy to imagine demand for an alternative. The aeroponic system also doesn’t use pesticides.

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It does use a lot of energy–picture row after row of LED lights over every plant, along with pumps delivering nutrients and an HVAC system–but the company says it isn’t clear yet how the carbon footprint compares to traditional farming of leafy greens. In California, a quarter of the state’s energy is used to deliver water to places like farms, and around half of a crop like baby spinach ends up in the trash, partly because of how quickly the produce goes bad. And then there’s the energy used in trucking.

“The embodied energy of what’s actually consumed is huge,” says Rosenberg. “A true analysis hasn’t been done on our category of baby leafy greens, but I’d be very interested in participating in that.”

Over the last 11 years, the company has worked to painstakingly optimize every step of their growing process. When they looked at LED lights, for example, they realized that the plants didn’t need the yellow spectrum to grow–and yellow light happened to be the biggest energy hog, so they redesigned the lights to take out the yellow. They’ve also developed their own systems for everything from automated harvesting to packaging.

“What we’re doing is complicated,” Rosenberg says. “There’s a reason we’ve been at it since 2004 and we’re ready to build our biggest farm today. It takes a lot of data.”

Ultimately, they hope to be first to take vertical farming to a large scale. “There’s a romanticized notion of local food production,” he says. “So you’re seeing these small players pop up in different places, but I actually think most of them are going to go out of business. While their ambition is in the right place, they don’t understand the complexity of things like logistics.”

The biggest challenge for the industry is the expense of building a system like the one AeroFarms is creating in Newark. “It’s a capital intensive industry,” says Rosenberg. “If you look at the investment community in the cleantech space, they want capital-efficient, social networking kind of businesses. There hasn’t been a sprint of capital to capital-intensive spaces.”

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Still, the company was able to raise $30 million from investors like Goldman Sachs and Prudential for the new farm. “Goldman Sachs looked at other urban farming companies and they couldn’t get comfortable with the economics, but they got comfortable with AeroFarms’ economics,” he says. “That’s where what we’re doing is unique. We’ve solved some crucial pieces of the puzzle to make the economics work.”

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About the author

Adele Peters is a staff writer at Fast Company who focuses on solutions to some of the world's largest problems, from climate change to homelessness. Previously, she worked with GOOD, BioLite, and the Sustainable Products and Solutions program at UC Berkeley.